Chinese Leaders Vow to Step Up Support for Flagging Economy
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Chinese Leaders Vow to Step Up Support for Flagging Economy

Pledges on government spending and monetary support come as data points to slowing growth

By STELLA YIFAN XIE
Wed, Dec 13, 2023 9:01amGrey Clock 4 min

Chinese leaders vowed to increase government spending and monetary support for the economy at an annual gathering, signalling they plan to stick with a measured approach to stimulus despite calls for bolder action.

The Central Economic Work Conference, which ended Tuesday, capped a bruising year for the country’s economy, which has struggled with a drawn-out housing crunch and weak consumption.

The trouble shows no sign of abating. After a pickup in the third quarter, data in recent weeks has pointed to slowing growth again as exports struggle, activity in the services sector slows and deflation deepens.

Still, Chinese leaders offered few specifics Tuesday on how they intend to reignite consumer and business confidence and reinvigorate growth.

Chinese leader Xi Jinping presided over the two-day meeting, where leaders urged officials to increase fiscal stimulus and help expand domestic demand, according to Chinese state media. They also acknowledged economic challenges, including “excess capacity in certain industries and weak sentiment in the society,” according to a readout of the meeting.

Chinese leaders also called for strengthening the resilience of industrial supply chains and accelerating the development of artificial intelligence, as well as other strategic industries such as aerospace and biotechnology.

The closed-door meeting, which is typically held in December each year to map out plans for economic policy-making, sets out the leadership’s growth ambitions for the following year, though the detailed targets won’t be released until March, during the National People’s Congress.

Though the overall tone of the conference was pro-growth, “it is still not a call for massive stimulus,” economists at Société Générale said in a note to clients after the readout was published. Instead, officials are emphasising the need to stabilise the economy and stem risks to growth, they said.

Many economists expect Beijing to anchor its growth target at around 5% in 2024, taking their cue from a meeting last week of the Communist Party’s Politburo, its body of top leaders. Policy makers emphasised the importance of economic progress, saying the country needed to “pursue stability through growth.”

This year’s target was also set at around 5%. Despite its difficulties, the economy looks set to hit that goal this year, but economists say maintaining that pace will be tough without bigger measures to stimulate the economy.

Beijing has taken some measures this year including interest rate cuts and channeling cheaper loans to firms to arrest the downturn but has so far failed to reverse a broad-based loss of confidence.

China’s difficult year contrasts with surprising resilience in the U.S., where buoyant consumer and government spending have kept the economy motoring despite aggressive increases in interest rates by the Federal Reserve. The latest data on jobs and inflation has stoked optimism that the U.S. will avoid recession and instead enjoy a “soft landing,” in which price growth slows to target without a steep rise in unemployment. That marks a reversal in expectations from earlier in the year when China was expected to easily outpace a cooling U.S. economy.

And there are fresh signs of trouble for China.

Business surveys showed factory activity slid deeper into contraction in November as domestic and foreign orders dried up, while activity in the services sector shrank for the first time this year as consumers cut back spending.

Exports rose just 0.5% on the year last month after shrinking for six months, highlighting the drag from slowing growth in the U.S. and Europe.

Weak domestic spending and bloated industrial capacity caused consumer prices in China to fall in November for the second straight month, deepening a bout of deflation that economists say could prove hard to shake if the economy doesn’t pick up soon.

China’s slow-motion property crunch shows few signs of abating. Some developers have defaulted on their debts and construction has stalled on millions of homes. Home prices fell in October and new investment in the sector is shrinking.

A central question for investors and economists is whether Beijing will experiment with novel stimulus approaches to shore up battered confidence among households and businesses.

At the meeting, Chinese leaders vowed to expand consumption and raise income for both urban and rural residents but offered little sign that they may pivot to giving cash handouts to households, despite repeated calls from policy advisers and economists to do so.

Instead, the government is seen as more likely to step up efforts to resolve the crisis in the property market, which remains a major drag on overall growth.

Chinese leaders called for equal treatment for developers to meet their financing needs—a likely reference to the perception that banks favour state-backed developers over private ones. They also urged accelerating the construction of government-subsidised affordable housing and urban village renovation projects.

Still, the meeting didn’t spell out a plan to help cash-strapped developers finish tens of millions of uncompleted apartments, a crucial step that economists believe will help restore household’s confidence in the government.

While officials aren’t expected to disclose a growth target until a political gathering next spring, economists and investors are already debating how aggressive Beijing will be with its 2024 goal.

Economists from J.P. Morgan predicted that policy makers will likely maintain a goal of around 5%, to signal a renewed focus on the economy. Robin Xing, chief China economist at Morgan Stanley, said he expects Beijing to set a target of 4.5% to 5% and pursue a stronger fiscal stimulus.

Others believe Beijing will stick to a more conservative target because of the headwinds facing the economy. Ting Lu, chief China economist at Nomura, said he expects China to aim for around 4.5%.

“I still think the Chinese government is quite rational,” said Lu, who cautioned that the economy hasn’t bottomed out and the actual growth rate could slip to 4% in 2024 from Nomura’s 5.2% forecast for 2023.



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A Killer Golf Swing Is a Hot Job Skill Now

Companies are eager to hire strong players who use hybrid work schedules to schmooze clients on the course

By CALLUM BORCHERS
Fri, Jun 14, 2024 5 min

Standout golfers who aren’t quite PGA Tour material now have somewhere else to play professionally: Corporate America.

People who can smash 300-yard drives and sink birdie putts are sought-after hires in finance, consulting, sales and other industries, recruiters say. In the hybrid work era, the business golf outing is back in a big way.

Executive recruiter Shawn Cole says he gets so many requests to find ace golfers that he records candidates’ handicaps, an index based on average number of strokes over par, in the information packets he submits to clients. Golf alone can’t get you a plum job, he says—but not playing could cost you one.

“I know a guy that literally flies around the world in a private jet loaded with French wine, and he golfs and lands hundred-million-dollar deals,” Cole says.

Tee times and networking sessions have long gone hand-in-golf-glove. Despite criticism that doing business on the course undermines diversity, equity and inclusion efforts—and the fact that golf clubs haven’t always been open to women and minorities —people who mix golf and work say the outings are one of the last reprieves from 30-minute calendar blocks

Stars like Tiger Woods and Michelle Wie West helped expand participation in the sport. Still, just 22% of golfers are nonwhite and 26% are women, according to the National Golf Foundation.

To lure more people, clubs have relaxed rules against mobile-phone use on the course, embracing white-collar professionals who want to entertain clients on the links without disconnecting from the office. It’s no longer taboo to check email from your cart or take a quick call at the halfway turn.

With so much other business conducted virtually, shaking hands on the green and schmoozing over clubhouse beers is now seen as making an extra effort, not slacking off.

Americans played a record 531 million rounds last year. Weekday play has nearly doubled since 2019, with much of the action during business hours , according to research by Stanford University economist Nicholas Bloom .

“It would’ve been scandalous in 2019 to be having multiple meetings a week on the golf course,” Bloom says. “In 2024, if you’re producing results, no one’s going to see anything wrong with it.”

A financial adviser at a major Wall Street bank who competes on the amateur circuit told me he completes 90% of his tasks by 10 a.m. because he manages long-term investment plans that change infrequently. The rest of his workday often involves golfing with clients and prospects. He’s a member of a private club with a multiyear waiting list, and people jump at the chance to join him on a course they normally can’t access.

There is an art to bringing in business this way. He never initiates shoptalk, telling his playing partners the round is about having fun and getting to know each other. They can’t resist asking about investment strategies by the back nine, he says.

Work hard, play hard

Matt Parziale golfed professionally on minor-league tours for several years, but when his dream of making the big time ended, he had to get a regular job. He became a firefighter, like his dad.

A few years later he won one of the biggest amateur tournaments in the country, earning spots in the 2018 Masters and U.S. Open, where he tied for first among non-pros.

The brush with celebrity brought introductions to business types that Parziale, 35 years old, says he wouldn’t have met otherwise. One connection led to a job with a large insurance broker. In 2022 he jumped to Deland, Gibson Insurance Associates in Wellesley, Mass., which recognised his golf game as a tool to help win large accounts.

He rescheduled our interview because he was hosting clients at a private club on Cape Cod, and squeezed me in the next morning, before teeing off with a business group in Newport, R.I.

A short time ago, Parziale couldn’t imagine making a living this way. Now he’s the norm in elite amateur golf circles.

“I look around at the guys at the events I play, and they all have these jobs ,” he says.

His boss, Chief Executive Chip Gibson, says Parziale is good at bringing in business because he puts as much effort into building relationships as honing his game. A golf outing is merely an opportunity to build trust that can eventually lead to a deal, and it’s a misconception that people who golf during work hours don’t work hard, he says.

Barry Allison’s single-digit handicap is an asset in his role as a management consultant at Accenture , where he specialises in travel and hospitality. He splits time between Washington, D.C., and The Villages, Fla., a golf mecca that boasts more than 50 courses.

It can be hard to get to know people in distributed work environments, he says. Go golfing and you’ll learn a lot about someone’s temperament—especially after a bad shot.

“If you see a guy snap a club over his knee, you don’t know what he’s going to snap next,” Allison says.

Special access

On a recent afternoon I was a lunch guest at Brae Burn Country Club, a private enclave outside Boston that was the site of U.S. Golf Association championships won by legends like Walter Hagen and Bobby Jones. I parked in the second lot because the first one was full—on a Wednesday.

My host was Cullen Onstott, managing director of the Onstott Group executive search firm and a former collegiate golfer at Fairfield University. He explained one reason companies prize excellent golfers is they can put well-practiced swings on autopilot and devote most of their attention to chitchat.

It’s hard to talk with potential customers about their needs and interests when you’re hunting for errant shots in the woods. It’s also challenging if you show off.

The first hole at Brae Burn is a 318-yard par 4 that slopes down, enabling big hitters like Onstott to reach the putting green in a single stroke. But to stay close to his playing partners and keep the conversation flowing, he sometimes hits a shorter shot.

Having an “in” at an exclusive club can make you a catch. Bo Burch, an executive recruiter in North Carolina, says clubs in his region tend to attract members according to their business sectors. One might be chock-full of real-estate investors while another has potential buyers of industrial manufacturing equipment.

Burch looks for candidates who are members of clubs that align with his clients’ industries, though he stresses that business acumen comes first when filling positions.

Tami McQueen, a former Division I tennis player and current chief marketing officer at Atlanta investment firm BIP Capital, signed up for private golf lessons this year. She had noticed colleagues were wearing polos with course logos and bringing their clubs to work. She wanted in.

McQueen joined business associates on the golf course for the first time in March at the PGA National Resort in Palm Beach Gardens, Fla. She has lowered her handicap to a respectable 26 and says her new skill lends a professional edge.

“To be able to say, ‘I can play with you and we can have those business meetings on the course’ definitely opens a lot more doors,” she says.

MOST POPULAR
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This stylish family home combines a classic palette and finishes with a flexible floorplan

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Just 55 minutes from Sydney, make this your creative getaway located in the majestic Hawkesbury region.

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